Racing to the bottom

Ohio wants to lure Sears out of Illinois. By offering as much as $400 million in incentives, Ohio aims to convince Sears to move its headquarters from Hoffman Estates and presumably to a similar Cleveland suburb. It’s unfortunate and ultimately destructive for US states, let alone debt-ridden Rustbelt states, to engage in a zero-sum economic contest. Illinois’ loss is not Ohio’s gain. On the contrary, any state’s loss is the nation’s loss. Interstate competition only drains public coffers and damages communities, and does nothing to address the systemic economic crisis gripping the country. As local economy writers like Michael Shuman and Amy Cortese correctly point out, the benefits of such a “victory” may be fleeting. Who’s to say that Sears won’t seek greener pastures in another US state or country in five or ten years’ time? This kind of short-term thinking nearly destroyed the economy and it certainly cannot fix it.